New NFT Markets Could Steal Part of OpenSea’s Market Share

The boom of the NFT market this spring resulted in astonishing figures, but it was nothing compared to the resurgence in late summer, leading to nearly 10.7 billion dollars in trading volume just in the third quarter. OpenSea is, of course, responsible for the largest share of that activity.

With around 6.9 billion dollars in trading volume in the last quarter and a tenfold increase in activity from July to August, OpenSea quickly became the largest player in the NFT space.

However, its success has not come without certain difficulties and consequences, including high transaction fees on Ethereum, the departure of OpenSea’s product lead who was caught trading on insider information, and community feedback following the hiring of a new CFO, which potentially hinted at an IPO instead of a token launch.

NFTs are an area that is changing extremely rapidly with a ton of money flowing in, so it’s no surprise that other major players across the crypto space are ramping up their own efforts in the non-fungible token market. Likewise, competing markets are launching new features and incentives, while others aim to attract OpenSea users with tokens or other incentives.

We present 8 notable NFT markets, many of which are newly launched or on the horizon, and could steal part of OpenSea’s market share.

1. Coinbase NFT

OpenSea has greatly benefited from being the first, but Coinbase has been one of the biggest names in the entire crypto industry for years, and Brian Armstrong and crew are aiming for the top as NFTs continue to occupy mainstream space. 

Coinbase NFT will be a peer-to-peer platform like OpenSea, promising an intuitive design built on top of a decentralized marketplace. It will start with Ethereum, currently the largest platform for NFTs, but plans to support other blockchains as well. Coinbase’s distinguishing feature will represent a social layer that could help build community and improve the discovery of new creators.

There is no doubt that people are excited about the next assumption. Coinbase NFT already has millions of people on its waiting list, compared to just over 750,000 total active traders on OpenSea. The platform is also partnering with a number of popular NFT creators for exclusive drops, so there may be an incentive to use Coinbase’s platform over competing markets.

2. FTX NFT

Launched in October through the crypto exchange FTX US, FTX took a different approach than Coinbase. First, it started in the smaller but rapidly growing Solana NFT world, but introduced Ethereum blockchain in early December. 

Second, it is not a peer-to-peer marketplace, but a centralized, custodial marketplace and requires the same level of user identification through know-your-consumer (KYC) checks. However, there are advantages over existing NFT markets on Solana. Sales fees are lower, plus it is possible to pay with a credit card or bank account funds. In addition to fixed-price sales, it also supports auctions.

The impact of FTX was also felt quickly. After the market stated it would not list NFT projects that offer secondary royalties as rewards to other owners, due to U.S. securities laws, many NFT projects on Solana canceled their plans for royalties. We will see if the recently added Ethereum support does the same.

3. Nifty Gateway

Until recently, Nifty Gateway was a marketplace exclusively for curated drops of NFT artworks, standing out from competitors in early 2021 thanks to projects with celebrities and prominent artists. But as the market expanded, the exchange-owned marketplace Gemini began to evolve.

In October, Nifty Gateway transformed into an aggregator of other Ethereum NFT markets, promoting its listings through avatar collections and more, offering an easy way for users to buy NFTs with credit cards. And then it recently announced plans to use a partial off-chain system that reduces transaction fees on purchasing Ethereum NFTs by up to 70 percent by leveraging existing custody technology.

Nifty Gateway  also hosted the release of renowned NFT artist Pak for nearly 92 million dollars for the inventive project Merge, so the marketplace could ultimately get the best of both worlds as a curator and aggregator. The planned launch of a new purchasing system in January could enhance its reach.

4. Infinity

As much as the decentralized exchange SushiSwap succeeded in its attempt to lure users and assets away from direct competitor Uniswap in a so-called “vampire attack,” Infinity aims to do something similar to OpenSea.

Infinity distinguishes itself from OpenSea by using a native governance token, which incentivizes platform usage and distributes 60 percent of the token supply to existing OpenSea users in hopes of luring them to Infinity. Infinity also has lower fees than OpenSea and reuses the same smart contracts with a familiar design.   

Currently, Infinity does not have nearly as many prominent NFTs available as OpenSea, but it is possible that the token could generate momentum. Keeping in mind that SushiSwap ultimately did not replace Uniswap, but still became a large decentralized exchange that remains very popular today. Anything is possible.

5. Rarible

About a year ago, before the NFT market truly exploded, Rarible had a higher monthly trading volume than OpenSea. But that is definitely not the case now. Rarible’s monthly volume has been hovering around 20 million dollars lately, which is much less than what OpenSea processes in an average day, let alone a month.

Rarible launched its RARI governance token (a type of token that gives voting rights) last year, fulfilling a demand that many crypto enthusiasts still have from OpenSea. Rarible also hosts NFTs from popular collections such as Bored Ape Yacht Club and Art Blocks. However, the marketplace has failed to compete with OpenSea in recent months.

However, Rarible is beginning to find ways to differentiate itself from OpenSea. It recently launched support for Flow blockchain (the same one used by NBA Top Shot), and will add Tezos NFTs in mid-December. It also plans to implement NFTs on Solana and Polygon in the near future, and launch a new messenger wallet-to-wallet service that helps facilitate communication on the platform. Rarible’s multi-chain approach could yield results. 

6. Zora

Zora is a free NFT protocol, based on Ethereum that charges zero fees, making it a public good. Given that, it’s no surprise that it has been embraced by DAOs and crypto-native creators. It has been used to sell the original Doge meme NFT and Bankless NFT from former U.S. presidential candidate Andrew Yang, and is also used by the social DAO Friends With Benefits and musician and artist Holly Herndon.

The protocol was launched with the idea of enabling “internet brands” and later launched auction houses, allowing creators and organizations to launch their own marketplaces. Zora’s ambitions seem to be growing, and if industry players continue to promote the protocol, it could attract more attention.

7. Artion

Another emerging marketplace that thinks it can squeeze out OpenSea, despite the significant advantage of the leading platform. Built on the Fantom blockchain, Artion looks similar to OpenSea, but does not take sales fees, only creation/minting fees. It also promises lower transaction fees on Fantom compared to Ethereum’s transaction fees.

It is still early, but Artion plans to add much more functionality over time, including building a bridge to bring NFTs from Ethereum to Fantom. That additional step could slow Artion’s potential game and attempt to seize market share from OpenSea, but if Fantom’s own NFT marketplace grows, then it could find an opportunity at the intersection of both blockchains.

8. Reddit

This is a big question mark for now, but the massive social media community Reddit is hiring a senior engineer to help build an NFT marketplace. Whether it will ultimately be used for mass trading in the market remains to be seen, but given Reddit’s large user base, it could prove to be an effective platform for attracting people.

Reddit already has an Ethereum-based rewards initiative that it is trying to scale with Optimistic rollups technology, via Arbitrum, so the company clearly sees potential in the overall crypto space. If Reddit aims to compete with OpenSea, the impact could be significant.

GameStop is another potential wild card as an established brand planning to launch an NFT marketplace on Ethereum. Still riding the momentum of “meme stocks” from earlier this year, GameStop is reportedly using Loopring’s Layer 2 scaling technology, but it is still unclear when the video game retailer will launch its platform.